Buying PXD call contracts.

Pioneer Natural Resources (PXD) is a profitable oil and gas company with a great dividend.

The stock pulled back as oil prices stabilized this summer. But PXD continues to generate reliable profits and trades for a cheap price compared to earnings.

This morning, the Bank of America research team downgraded the stock, but shares have moved higher. That’s a great sign of strength and gives me confidence that PXD is set to move back higher.

It wouldn’t be surprising to see PXD rebound from its current level near $212 to previous highs above $280.

Buying in-the-money call contracts gives us exposure to the stock if this rebound happens. And it helps to protect our capital if PXD continues to pull back.

• Buy (to open) 4 PXD August 19th $190 Calls
• Limit $27.00 or less
• The new position will represent roughly 9.9% of our Spec Model capital
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• 11:57 Executed
• Bot 4 PXD August 19th $190 Calls @ $26.76